Saturday, October 6, 2007

I have been visiting my parents for almost every weekend over the last few weeks at my village near Hassan for one or the other reasons like marriage, festival, pooja etc. Last week when I met my dad for the third consecutive weekend, I found him too low and disturbed. While discussing with him on the various issues pertaining to Agriculture, plantation and villagers, I came to know that he had sold two truck loads of Cabbage grown in his plantation for just Rs.7000/-. Needless to say this made him feel so low. This exactly is the situation with every farmer who grows vegetable in India.While on my way back to Bangalore, I was thinking to myself, if this is the result you get after investing 3 full months, 3shifts a day and few thousands of rupees on fertilizers, pesticides, labors etc. there is no wonder why farmers in some parts of the country are committing suicide and most of the others are migrating to nearby towns and cities in search of jobs.

Contrary to the situation faced by farmers the people who live in towns and cities have different story to say. They always crib about hike in the vegetable price and how it results in toppling their financial plan, every hotelier saying that, hike in the vegetable price has resulted in increased cost and thus they have increased the prices of food. So, a same vegetable plays two different roles in two different places from ruining up farmers life to jeopardizing the financial plan of city dwellers.

So, what exactly is the reason for this leakage? Any kind of rocket science approach is not required to find out the answer, but I feel some of the reasons are 1) there is no organized distribution system 2) There is no support price given. 3) Buyers are not regulated. 4) Too many middlemen. I believe by the time it reaches consumer it changes at least 3 hands at various stages. 5) Prices are fixed by middlemen. 6) Shortage of cold storage units.Considering the fact that vegetables are highly perishable in nature, there has been no effort put by government to set up cold storage units in the rural areas. At least a cold storage in every gram panchayat may bring in some kind of positive change in the lives of vegetable cultivators during the glut.

A minimum procurement price supported by organized distribution system through fair price shops dedicated to sell only vegetables will also avoid cultivators making loss. Kiosks in every post office in the rural area to give information about the prices of the vegetable in various parts of the country and other related issues will also bring in lot of reforms. The reason why I have mentioned post office is because of their reach. Even today in India no distribution channel has got as close reach as post offices have. Of course there has been couple of initiatives taken by private sectors in India both in improvising the distribution system and providing required information to the farmers. Pepsi foods initiative of buying potatoes & tomatoes from farmers, which did not take big leap because of their poor supply chain management and ITC’s e-Choupal is more or less a paper tiger and almost struck in the same place where it started seven years back.

Contract farming is something which is picking up very well in the country, but nevertheless it has to be monitored closely by either government or APMC since it is proving biased against the farmers in lot of cases. For instance, small and marginal farmers are not equipped with information and knowledge required in this regard and farmers have very little bargaining power at the present model. Growing retail sector is also giving some kind of hopes as some of the big retailers are sourcing vegetables directly from the farmers.

Agriculture provides livelihoods to 70 percent of the rural people resulting in India being the largest producer of vegetable in the world. Post Green revolution of 1970s which enabled India to achieve self-sufficiency in food grains, agricultural growth has slowed from 3.5 percent in mid 1980s to 2 percent in mid 1990s to 2000s. Farmers migrating to cities in search of jobs are a major cause of concern. This has already resulted in low agricultural productivity. This time, the government of India has no ample time to react to this situation. If they do not act in the next hour, we’ll end up importing vegetables and fruits in the years to come.